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Poverty and Inequality Impact Analysis Regarding Cotton Subsidies: A Mali-based CGE Micro-accounting Approach

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  • Dorothée Boccanfuso
  • Luc Savard

Abstract

In this paper, we construct for Mali the first country-specific CGE model including a micro-simulation component so as to analyse how removing cotton subsidies in developed countries would impact poverty and inequality. To that effect, we have used the micro-accounting approach proposed by Chen and Ravallion. The issue has attracted significant attention, as it has played no small part in stalling the broader trade agenda. So far, research has been mainly carried out with a partial equilibrium analysis, whereas we use the first CGE micro-simulation model. A 17 sector CGE model comprising almost 5,000 households is used to demonstrate that removing cotton subsidies would contribute towards a significant decrease in poverty in Mali. Moreover, our results show that removing cotton subsidies while keeping other agricultural subsidies does not lessen the positive effects observed. It also appears that removing subsidies would marginally contribute towards easing inequality in Mali. Copyright 2007 The author 2007. Published by Oxford University Press on behalf of the Centre for the Study of African Economies. All rights reserved. For permissions, please email: journals.permissions@oxfordjournals.org, Oxford University Press.

Suggested Citation

  • Dorothée Boccanfuso & Luc Savard, 2007. "Poverty and Inequality Impact Analysis Regarding Cotton Subsidies: A Mali-based CGE Micro-accounting Approach," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 16(4), pages 629-659, August.
  • Handle: RePEc:oup:jafrec:v:16:y:2007:i:4:p:629-659
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    Cited by:

    1. Bourguignon, François & Bussolo, Maurizio, 2013. "Income Distribution in Computable General Equilibrium Modeling," Handbook of Computable General Equilibrium Modeling, Elsevier.
    2. Fousseini Traoré, 2012. "Do global cotton subsidies affect the Malian economy? New evidence from a multimarket-general equilibrium model," Economics Bulletin, AccessEcon, vol. 32(2), pages 1640-1652.
    3. Saeed Solaymani, 2016. "Impacts of energy subsidy reform on poverty and income inequality in Malaysia," Quality & Quantity: International Journal of Methodology, Springer, vol. 50(6), pages 2707-2723, November.
    4. Dorothée Boccanfuso & G. Rodolphe A. Missinhoun & Luc Savard, 2010. "Réformes economiques et croissance pro-pauvre : une application macro-micro aux Philippines," Recherches économiques de Louvain, De Boeck Université, vol. 76(3), pages 257-288.
    5. Essama-Nssah, B., 2008. "Assessing the redistributive effect of fiscal policy," Policy Research Working Paper Series 4592, The World Bank.

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